Question 1

A four dollar tax on a gallon of gasoline would

Accepted Answer

A) lower gasoline consumption and lower air pollution. 
B) lower gasoline consumption and raise air pollution. 
C) raise gasoline consumption and raise air pollution. 
D) raise gasoline consumption and lower air pollution. 
A) lower gasoline consumption and lower air pollution. 
B) lower gasoline consumption and raise air pollution. 
C) raise gasoline consumption and raise air pollution. 
D) raise gasoline consumption and lower air pollution.

Question 2

The price system

Accepted Answer

A) sends signals to producers. 
B) sends signals to consumers. 
C) is based on supply and demand. 
D) All of the choices are true about the price system. 
A) sends signals to producers. 
B) sends signals to consumers. 
C) is based on supply and demand. 
D) All of the choices are true about the price system.

Question 3

Which of the following statements is false?

Accepted Answer

A) One of the basic principles capitalism is based on is to "trust no one." 
B) To have real competition in a market economy no one business should be able to have any influence over price. 
C) A basic trade-off exists between the goals of equity and efficiency for a society. 
D) The forces of supply and demand will NOT automatically lead to an equitable distribution of income. 
A) One of the basic principles capitalism is based on is to "trust no one." 
B) To have real competition in a market economy no one business should be able to have any influence over price. 
C) A basic trade-off exists between the goals of equity and efficiency for a society. 
D) The forces of supply and demand will NOT automatically lead to an equitable distribution of income.

Question 4

Which of the following is NOT a characteristic of the capitalist form of economic organization?

Accepted Answer

A) Central planning. 
B) A reliance on decentralized market processes for resource allocation purposes. 
C) Private ownership of productive resources. 
D) All of the choices are true. 
A) Central planning. 
B) A reliance on decentralized market processes for resource allocation purposes. 
C) Private ownership of productive resources. 
D) All of the choices are true.

Question 5

Private ownership of nearly all of a nation's land,labor,capital,and entrepreneurial ability is common to

Accepted Answer

A) communism. 
B) fascism. 
C) socialism. 
D) None of these choices are true. 
A) communism. 
B) fascism. 
C) socialism. 
D) None of these choices are true.

Question 6

Our government helps the free enterprise system work by doing all of the following,except

Accepted Answer

A) enforcing business contracts. 
B) using a central planning agency to direct the production process. 
C) defining property rights. 
D) lowering some of the barriers to competition. 
A) enforcing business contracts. 
B) using a central planning agency to direct the production process. 
C) defining property rights. 
D) lowering some of the barriers to competition.

Question 7

If we were to examine the economic record of the former Soviet Union and China during the 1980s,we could reasonably conclude that

Accepted Answer

A) China was successful and the Soviet Union was not. 
B) The Soviet Union was successful and China was not. 
C) Both the Soviet Union and China were successful. 
D) Neither China nor the Soviet Union were successful. 
A) China was successful and the Soviet Union was not. 
B) The Soviet Union was successful and China was not. 
C) Both the Soviet Union and China were successful. 
D) Neither China nor the Soviet Union were successful.

Question 8

By the late 1970s,

Accepted Answer

A) Russia began reforms which eventually transformed it to a more market-oriented economy. 
B) China began reforms which eventually transformed it to a more market-oriented economy. 
C) Russia and China were both quickly becoming market-oriented economies. 
D) None of the choices are true. 
A) Russia began reforms which eventually transformed it to a more market-oriented economy. 
B) China began reforms which eventually transformed it to a more market-oriented economy. 
C) Russia and China were both quickly becoming market-oriented economies. 
D) None of the choices are true.

Question 9

Adam Smith believed that people are guided by

Accepted Answer

A) the principle "let your conscience be your guide." 
B) greed. 
C) the public good. 
D) an innate sense of fairness. 
A) the principle "let your conscience be your guide." 
B) greed. 
C) the public good. 
D) an innate sense of fairness.

Question 10

Which statement is true?

Accepted Answer

A) The communist system of state-owned enterprises in the Soviet Union was an example of pure communism. 
B) Aside from Cuba,Vietnam,North Korea,and a few other very small nations,there are no other communist powers left in the world. 
C) Mikhail Gorbachev still holds substantial power in Russia. 
D) None of the statements are true. 
A) The communist system of state-owned enterprises in the Soviet Union was an example of pure communism. 
B) Aside from Cuba,Vietnam,North Korea,and a few other very small nations,there are no other communist powers left in the world. 
C) Mikhail Gorbachev still holds substantial power in Russia. 
D) None of the statements are true.

Question 11

The price mechanism deals _____ with the issue of an equitable income distribution and ____ with the issue of efficiency.

Accepted Answer

A) well;well 
B) poorly;poorly 
C) well;poorly 
D) poorly;well 
A) well;well 
B) poorly;poorly 
C) well;poorly 
D) poorly;well

Question 12

When our resources are NOT allocated efficiently,we have _______________.

Accepted Answer

A) answered the basic economic questions 
B) a market failure 
C) a government failure 
D) market equity 
A) answered the basic economic questions 
B) a market failure 
C) a government failure 
D) market equity

Question 13

In Sweden

Accepted Answer

A) the government has kept unemployment low by offering industry and workers a series of subsidies and incentives. 
B) education is free from nursery school through college. 
C) women may take a year off work after child birth while receiving 80 percent of their pay. 
D) All of the choices are true. 
A) the government has kept unemployment low by offering industry and workers a series of subsidies and incentives. 
B) education is free from nursery school through college. 
C) women may take a year off work after child birth while receiving 80 percent of their pay. 
D) All of the choices are true.

Question 14

All of the following describes Nazi Germany's economic system,except that

Accepted Answer

A) the ownership of land,labor and capital was in private hands. 
B) it was highly nationalistic with much of its production directed toward military goods and services. 
C) the government dictated what was to be produced. 
D) a major goal was to redistribute income from the wealthy and the middle class to the poor. 
A) the ownership of land,labor and capital was in private hands. 
B) it was highly nationalistic with much of its production directed toward military goods and services. 
C) the government dictated what was to be produced. 
D) a major goal was to redistribute income from the wealthy and the middle class to the poor.

Question 15

Which statement is true?

Accepted Answer

A) Russia has embraced capitalism at a much faster rate than ChinA. 
B) The Russian government today is moving much closer to central planning than when the country was part of the Soviet Union. 
C) The standard of living in Russia is higher than that of the United States. 
D) None of the statements are true. 
A) Russia has embraced capitalism at a much faster rate than ChinA. 
B) The Russian government today is moving much closer to central planning than when the country was part of the Soviet Union. 
C) The standard of living in Russia is higher than that of the United States. 
D) None of the statements are true.

Question 16

In a pure capitalist economy,"what to produce" is determined by

Accepted Answer

A) a central planning board. 
B) the price mechanism. 
C) the issuing of government coupons used along with money to purchase goods. 
D) None of these choices are true. 
A) a central planning board. 
B) the price mechanism. 
C) the issuing of government coupons used along with money to purchase goods. 
D) None of these choices are true.

Question 17

In the former Soviet Union,

Accepted Answer

A) the collective farms were more productive per acre than the private plots of land owned by peasants. 
B) there was no private ownership of any farmland. 
C) the private plots of land were more productive per acre than the large collective farms. 
D) the land under cultivation was equally split between private plots of land and the collective farms. 
A) the collective farms were more productive per acre than the private plots of land owned by peasants. 
B) there was no private ownership of any farmland. 
C) the private plots of land were more productive per acre than the large collective farms. 
D) the land under cultivation was equally split between private plots of land and the collective farms.

Question 18

Karl Marx and Friedrich Engels believed that after the capitalists were overthrown,eventually

Accepted Answer

A) the state would get stronger. 
B) the state would wither away. 
C) the capitalists would regain power. 
D) a fascist state would emerge. 
A) the state would get stronger. 
B) the state would wither away. 
C) the capitalists would regain power. 
D) a fascist state would emerge.

Question 19

Which statement was coined by Adam Smith?

Accepted Answer

A) By pursuing his own interest,he frequently promotes that of the society more effectually than when he really intends to promote it. 
B) The factory owner,by paying his workers meager wages,is able to use this surplus to buy more capital goods. 
C) The foundation of our economic system is socialist ownership of the means of production in the form of state property and collective farm and cooperative property. 
D) None of these statements were coined by Adam Smith. 
A) By pursuing his own interest,he frequently promotes that of the society more effectually than when he really intends to promote it. 
B) The factory owner,by paying his workers meager wages,is able to use this surplus to buy more capital goods. 
C) The foundation of our economic system is socialist ownership of the means of production in the form of state property and collective farm and cooperative property. 
D) None of these statements were coined by Adam Smith.

Question 20

Which of these is NOT an example of opportunity cost?

Accepted Answer

A) Lobster catchers in Point Judith,Rhode Island continued to trap lobsters at the cost of depleting the lobster population. 
B) President George W.Bush's administration has pushed for oil exploration in the Arctic National Wildlife Refuge in Alaska at the cost of environmental preservation. 
C) Lobster catchers in Port Lincoln,Australia paid a licensing fee for the right to own lobster traps. 
D) The "bridge to nowhere" to be built near Anchorage,Alaska comes at the cost of adding to the federal budget deficit. 
A) Lobster catchers in Point Judith,Rhode Island continued to trap lobsters at the cost of depleting the lobster population. 
B) President George W.Bush's administration has pushed for oil exploration in the Arctic National Wildlife Refuge in Alaska at the cost of environmental preservation. 
C) Lobster catchers in Port Lincoln,Australia paid a licensing fee for the right to own lobster traps. 
D) The "bridge to nowhere" to be built near Anchorage,Alaska comes at the cost of adding to the federal budget deficit.

Exam 3: The Mixed Economy

A four dollar tax on a gallon of gasoline would

The price system

Which of the following statements is false?

Which of the following is NOT a characteristic of the capitalist form of economic organization?

Private ownership of nearly all of a nation's land,labor,capital,and entrepreneurial ability is common to

Our government helps the free enterprise system work by doing all of the following,except

If we were to examine the economic record of the former Soviet Union and China during the 1980s,we could reasonably conclude that

By the late 1970s,

Adam Smith believed that people are guided by

Which statement is true?

The price mechanism deals _____ with the issue of an equitable income distribution and ____ with the issue of efficiency.

When our resources are NOT allocated efficiently,we have _______________.

In Sweden

All of the following describes Nazi Germany's economic system,except that

Which statement is true?

In a pure capitalist economy,"what to produce" is determined by

In the former Soviet Union,

Karl Marx and Friedrich Engels believed that after the capitalists were overthrown,eventually

Which statement was coined by Adam Smith?

Which of these is NOT an example of opportunity cost?

A Brief Economic History of the United States

Resource Utilization

Supply and Demand

The Household Consumption Sector

The Business Investment Sector

The Government Sector

The Export-Import Sector

Gross Domestic Product

Economic Fluctuations, unemployment, and Inflation

Classical and Keynesian Economics

Fiscal Policy and the National Debt

Money and Banking

The Federal Reserve and Monetary Policy

A Century of Economic Theory

Economic Growth and Productivity

Demand,supply,and Equilibrium

The Price Elasticities of Demand and Supply

Theory of Consumer Behavior

Cost

Profit, loss, and Perfect Competition

Monopoly

Monopolistic Competition

Oligopoly

Corporate Mergers and Antitrust

Demand in the Factor Market

Labor Unions

Labor Markets and Wage Rates

Rent, interest, and Profit

Income Distribution and Poverty

International Trade

International Finance

Filters

The price mechanism deals _ with the issue of an equitable income distribution and with the issue of efficiency.